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Rubbing the Lamp – or the Localism Genie

18th March 2014

Richard McCarthy looks at the planning system....

Can more incentives for community planning support grant developers their every wish?

The planning process is necessarily quasi-judicial, with clear rules about influence over decisions taken in line with policies recognising that there is a need for everything from abattoirs to wireless antennae.

The system is designed to enable decisions to be taken objectively in line with policies developed and adopted through a process that is democratically accountable.


There are multiple issues with the paradigm, principally the lack of engagement with local government or the planning process until there is a proposal to debate. Much of the local comment on planning issues is driven by two broad groups - amateur urbanists who express an opinion on everything, usually negative, and people directly and adversely affected by a proposal.

The introduction of the NPPF, neighbourhood plans and emphasis on the views of local residents has strengthened the coalition of the well heeled and well housed who oppose new development for fear of an adverse impact on house prices - their house prices - whilst at the same time making it much more a difficult for the lack of an up to date Local Plan to frustrate future development. They strike a fascinating balance that is still not fully understood by many people and organisations.

Planning obligations secured through a S106 agreement are intended to mitigate an adverse impact of development which, if not addressed, would prevent the development taking place (the Community Infrastructure Levy – CIL - moves this to a more strategic level). Both are subject to stringent tests of reasonableness and can be challenged by the occult arts of viability testing.

The proposal put forward to require developers to contribute to local communities in order to lubricate the planning machine begs a number of questions. Aside from the thought that unless it is a direct payment to individuals to compensate them personally for the loss suffered, allegedly, as a consequence of the development, it many not change attitudes, particularly as meeting local infrastructure needs is already a feature of CIL..

More so than the current system it will favour projects that generate the biggest profit over the projects that generate the greatest social, economic or environmental benefit. Community endorsement of a project would be bought not because it was a well designed, socially or economically useful scheme, but because the promoter could promise the greatest largesse. Unlike a system where there is a considered, democratically accountable process for deciding how much this should be and what it should be spent on the result would be determined by the most vociferous and well resourced.  It would be very close to awarding planning consent in return for a payment, not to mention the fact that extracting money from the development process can only serve to reduce affordable housing, design quality and infrastructure – a process that is inequitable, especially if its in favour of the already asset rich.

But who would the payment be made to? If it is the individual residents then there is no relation between mitigation of an adverse impact but rather compensation for the perceived detriment, leading to long and rancorous disputes that would consume any financial benefit in lawyers’ fees and probably not accelerate development. With no rules about how the payment should be calculated those most able to make and argue their case would benefit at the expense of the communities in a neighbourhood. An alternative would be to make payments to local representative bodies, but this if fraught with further complications - everyone in a neighbourhood is affected by a development but only a limited number benefit from the largesse unless the payment is to a council.

What happens if the project is delayed, costs increase faster than values and viability is threatened, and will the government again step in and waive this obligation as they have with some S106 payments? It is easy to see the consequences of this and the likelihood of it happening.

No matter how hard you rub the lamp, there is no guarantee that the genie will appear and the wish will be granted. Perhaps more energy on community engagement, great design and wider community benefits funded through CIL should remain the focus of attention.

Richard McCarthy is executive director, central government and housing, at Capita

This article first appeared in Property Week magazine.

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